With offshore drilling contractors raking in the cash, it may feel like splitting hairs to rank one versus another. Noble (NYSE: NE) has been thrilling, Atwood Oceanics (NYSE: ATW) has silenced its critics (i.e., me), and Transocean's (NYSE: RIG) latest results left a pleasant taste. Still, I feel compelled to point you toward ENSCO International (NYSE: ESV).

ENSCO, along with Noble, boasts the best drilling margins, while its stock price has languished. Before I explain why I think that will change in 2008, let's look at the firm's recently reported fourth-quarter and full-year results.

In the quarter, ENSCO's jackup dayrates lifted to a handsome $141,000 per day, though utilization was a bit soft at 89%. Cash generated in the full year ran far in excess of capital expenditure requirements, and the company spent more than half a billion dollars on share repurchases, which has been giving quite a lift to per-share earnings. ENSCO closed out the year with a beautiful balance sheet, as demonstrated by a roughly 7% debt-to-capitalization ratio.

Now, with results like those, where's the room for improvement? Well, for one, plenty of jackups look to be rolling to higher dayrates in 2008. For example, the ENSCO 74, working for Apache (NYSE: APA) in the Gulf of Mexico, was contracted to roll from the mid-$120,000s to the low-$150,000s late this month. When asked if this strong rate is an anomaly or projectable for other comparable rigs, management went with the latter.

Just as important is the ENSCO 7500, which just moved to a much higher rate for Chevron (NYSE: CVX), not to mention the new deepwater rigs hitting the water this year and next. Yes, Fools, things are looking up for ENSCO. Let's hope the share price finally follows suit.

Fool contributor Toby Shute doesn't have a position in any company mentioned. Atwood is a Stock Advisor recommendation. The Motley Fool has a disclosure policy.